US pre-open: Stocks to edge up as House passes debt ceiling bill
US stock futures pointed to a slightly firmer open on Thursday after the House of Representatives overwhelmingly passed the debt ceiling bill agreed last weekend.
At 1225 BST, Dow Jones Industrial Average futures were up 0.1%, while S&P 500 and Nasdaq futures were 0.3% and 0.2% higher, respectively.
The bill still needs to get through the Senate and be signed by President Joe Biden ahead of the deadline to avert debt default.
Russ Mould, investment director at AJ Bell, said the passing of the bill by the House of Representatives virtually guarantees it will be signed off ahead of the extended 5 June deadline.
"This positive driver for stocks may not last as a US Treasury which has been draining its account at the Federal Reserve to keep the government going, thereby injecting significant liquidity into the system, reverses this policy and starts tapping the debt markets to bolster its coffers," he said.
Investors will also be mulling over the latest data out of China, which showed that factory activity unexpectedly jumped to growth in May as demand and production improved.
The Caixin/S&P Global manufacturing purchasing managers’ index rose to 50.9 in May from 49.5 in April, beating consensus expectations of 49.5.
A reading above 50 indicates growth. The print is a sharp contrast to an official PMI released on Wednesday that showed a fall in factory activity, suggesting that China’s recovery was stalling.
On the US macroeconomic front, the ADP employment report for May is due at 1415 BST, while the latest initial jobless claims are at 1330 BST. ISM’s manufacturing PMI for May is due at 1500 BST.
In corporate news, Macy’s slid in pre-market trade after the department store chain cut its annual sales and profit forecasts as it said demand trends in its discretionary categories weakened further in March.
For 2023, it now expects net sales of between $22.8bn and $23.2bn, down from previous guidance of $23.7 to $24.2bn. Comparable owned-plus-licensed sales are expected to decline by 6% to 7.5%, versus previous guidance for a fall of between 2% and 4%.